China PE consumption to fall in 2011 on lower imports, output growth

02 November 2011 09:00  [Source: ICIS news]

SINGAPORE (ICIS)--China’s annual consumption of polyethylene (PE) is estimated to fall by 0.8% to 17.5m tonnes by the end of 2011, the lowest drop seen since 2008 when it was recorded at 11.6m tonnes, according to data from Chemease, an ICIS service in China, on Wednesday.

The country consumed 17.7m tonnes of PE in 2010, which is an increase of 13.8% compared with that in 2009, the data showed.

The country’s exports were excluded from the projection because the volumes are small.

China’s PE consumption is expected to decline because of the country’s lower import volumes of the material as well as slower growth in output this year, industry sources said.

China’s imports totalled 7.36m tonnes in 2010, but the country’s imports are expected to drop by 4.1% to 7.05m tonnes this year.

The prevailing soft domestic PE prices have resulted in poor margins for import traders, making it unattractive for them to import the material.

In addition, China’s PE consumption is expected to decline as a result of the slower growth in its output of the product.

The country’s production of PE has been projected to grow by 1.6% to 10.49m tonnes in 2011, compared with a 27% increase to 10.32m tonnes in 2010.

As a result, the slower growth rate in production is expected to lead to a lower PE consumption in China.

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By: Amy Yu

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